As we discussed on a recent Cocktail Investing podcast, a growing number of data point tell us the tailwind for our Middle-class Squeeze investing theme continues to blow, but on the oppositive of the consumer spectrum, a new report suggests the same for the ultra-wealthy aspect of our Living the Life investing theme. What strikes us is the greatest confidence for continued wealth gains for this cohort was in the US, not China, which has been home to the fastest growing number of millionaires. That made China a key area of focus for not only luxury goods companies and others that are looking to ride our Living the Life investing theme. As China’s economy continues to slow, we’ll be watching those companies closely to see if they pivot their outlook to match this survey’s findings.

Despite a darkening economic outlook globally, wealth creation is slated to remain constant in 2019. The global population of ultrawealthy individuals—defined as having a net-worth of at least $30 million—is forecast to rise 22% to nearly 250,000 over the next five years, according to recent report by international real-estate firm Knight Frank. That means an additional 43,000 people will be worth more than $30 million by 2023.

The report included the results of a survey, which found that approximately 63% of the world’s wealthiest said they grew richer in 2018, thanks in part to stock market gains and global economic growth. These individuals also expect their wealth to increase over the next year. Confidence was highest in the U.S., where 80% of individuals worth $30 million and more expect to be better off over the next year.

“That pool of very wealthy people is [a luxury developer’s] demand pool. If it’s growing over time then that’s going to drive expansion in [their] market.”

About the Author

Chris Versace, Chief Investment Officer
I'm the Chief Investment Officer of Tematica Research and editor of Tematica Investing newsletter. All of that capitalizes on my near 20 years in the investment industry, nearly all of it breaking down industries and recommending stocks. In that time, I've been ranked an All Star Analyst by Zacks Investment Research and my efforts in analyzing industries, companies and equities have been recognized by both Institutional Investor and Thomson Reuters’ StarMine Monitor. In my travels, I've covered cyclicals, tech and more, which gives me a different vantage point, one that uses not only an ecosystem or food chain perspective, but one that also examines demographics, economics, psychographics and more when formulating my investment views. The question I most often get is "Are you related to…."